USD loses momentum during October 12–16 despite hot US inflation
💵 The dollar retreated after reaching an 18-month high, heading for its first weekly decline in more than a month. In Friday’s market update, DXY stood near 101.87, down around 0.35% from the previous week.
🏦 Stronger-than-expected CPI and PPI initially lifted expectations for another Fed rate hike. However, comments suggesting some officials saw no urgency to tighten further helped stabilize Treasury yields and weakened support for the dollar. Markets priced in roughly an 83% chance of unchanged rates at the October 27–28 meeting.
📉 Notably, the dollar weakened even as AI stocks sold off and concerns spread to credit markets. Defensive demand supported bonds and the Swiss franc, while the greenback struggled to sustain its post-inflation gains.
🛢️ Elevated oil prices continue to pressure the inflation outlook and weigh on energy-importing economies. Expectations for an October pause therefore do not rule out another rate increase later this year.
🔎 US Treasury yields, oil prices and policy signals will remain key next week. The pullback suggests hot inflation alone may be insufficient to sustain dollar gains without a further rise in rate expectations. One weaker week, however, does not confirm a lasting downtrend.
#Forex $SOL
💵 The dollar retreated after reaching an 18-month high, heading for its first weekly decline in more than a month. In Friday’s market update, DXY stood near 101.87, down around 0.35% from the previous week.
🏦 Stronger-than-expected CPI and PPI initially lifted expectations for another Fed rate hike. However, comments suggesting some officials saw no urgency to tighten further helped stabilize Treasury yields and weakened support for the dollar. Markets priced in roughly an 83% chance of unchanged rates at the October 27–28 meeting.
📉 Notably, the dollar weakened even as AI stocks sold off and concerns spread to credit markets. Defensive demand supported bonds and the Swiss franc, while the greenback struggled to sustain its post-inflation gains.
🛢️ Elevated oil prices continue to pressure the inflation outlook and weigh on energy-importing economies. Expectations for an October pause therefore do not rule out another rate increase later this year.
🔎 US Treasury yields, oil prices and policy signals will remain key next week. The pullback suggests hot inflation alone may be insufficient to sustain dollar gains without a further rise in rate expectations. One weaker week, however, does not confirm a lasting downtrend.
#Forex $SOL